Blog by an experienced Divorce and Family Law Attorney to educate people with Family Law and Divorce issues, answering questions and explaining complicated matters in a straightforward and understandable way. This blog is a Newsletter, designed for general information only. The information presented in this blog is not, is not intended to be, and shall not be construed to constitute legal advice, nor to create an attorney-client relationship.

Wednesday, December 26, 2007

Is a wealthy parent entitled to extraordinary treatment by the courts in setting child support at a level lower than the level calculated according to California's Child Support Guidelines?

In 2006, an appellate court in California overturned a law which had allowed litigants to seek an order to seal court records, in a support case involving billionaire Ronald Burkle, who had sought to keep his finances private from public disclosure.

All California Courts employ a state-wide Child Support Guideline, set forth in Family Code section 4055, in which Child Support is calculated based on the parties' respective incomes and their timeshare of their children.

Whereas Spousal Support is limited to the standard of living enjoyed by spouses during their marriage, California's public policy is that children should share in the same standard of living as their wealthier parent.

Billionaire Donald Bren's former significant-other (they were never married) and their children are currently seeking to discover his finances and obtain child support commensurate with his income. Whereas Bren unilaterally stipulated that he is willing to pay whatever a judge determines to be appropriate, he has been fighting efforts to force him to disclose details about his finances. His case is one of the latest in a series of cases in which extraordinary income earners have vigorously opposed efforts seeking disclosure of their finances.

In the 1987 White v. Marciano landmark case, the court was faced with the question: "Is detailed evidence concerning a noncustodial parent's lifestyle and wealth relevant in determining what amount of child support is "reasonable" where the noncustodial parent stipulates that he has an income of $1 million per year and is able to pay any reasonable amount of child support?" In that case, the appellate court held: "Where there is no question of the noncustodial parent's ability to pay any reasonable support order, we conclude that evidence of detailed lifesyle to be irrelevant to the issue of the amount of support to be paid and thus protected and inadmissible in determining the support order."

In the 1994 Estevez v. Superior Court case, the supporting parent resisted disclosing specific information about his lifestyle and financial status, instead unilaterally stipulating that his gross income was "not less than" $1.4 million per year", and he maintained that as an extraordinarily high income earner, any amount of child support calculated in accordance with the guideline would far exceed the reasonable needs of the children, as had been argued by the husband and approved by the Court in White v. Marciano. In Estevez, the appellate court applied the rationale of the White v. Marciano case and held that where the extraordinary high earner resists detailed discovery of his financial affairs, the trial court may make such assumptions concerning his net disposable income, federal income tax filing status, and deductions from gross earnings as are least beneficial to the extraordinary high earner.

However, in the 2001 Marriage of Hubner case, in which the husband claimed that his status as an extraordinary high income earner relieved him of any obligation to comply with his wife's discovery requests, the appellate court held: "Consistent with the principle that child support must be measured by the standard of living attainable by the parent's income, we conclude the trial court must be presented with sufficient information on which to properly asess the child's needs. Such information includes the amount of the supporting parent's actual income where that amount is disputed." In that case, the appellate court held that the guideline child support must be "tethered to the supporting parent's actual income."

We await the impending reported results in the Bren case.

Written by Certified Family Law Specialist DONALD F. CONVISER, of Warner Center Law Offices, whose website may be found at www.conviser.net